Friday, November 26, 2010

A watchmaker in Havana reading the "Granma", the official newspaper of the Communist Party.

The Cuban government will spend 130 million U.S. dollars next year in importing goods and raw materials to ensure supplies for the country's emerging private sector as a result of its current economic reform, a trade official said Friday.

Enrique Ramos, the economy ministry's trade director, said that supplies are the major concern for Cubans interested in the new self-employment options.

Wholesale markets with different prices can not be created in short term to ensure the supplies, so retail sales markets in the two currencies circulating in the country (the convertible peso CUC and the Cuban peso CUP) will remain in place, he added.

To ensure supplies to the self-employed sector, the Cuban government will "refocus" the imports and 130 million dollars will be spent to buy different products abroad in 2011, including 36 million spent on food.

Ramos warned that "these supplies will not appear by magic" and stressed the need to strengthen the supply market by increasing domestic production. The official added that the existing inventories of raw materials in the state warehouses will be moved to the network of shops in the country.

Raul Castro's government also plans to incorporate the sale of products in "different formats" for the private sector, so it could be possible to buy raw materials like oil, detergents and soft drinks in containers of more capacity at a relatively lower price."

"To encourage self-employment without guaranteeing the proper supplies would be irresponsible," the official said.

Last September, the government authorized the opening of small businesses to absorb the most of the half million jobs to be eliminated until next March, the first stage of a plan to reduce staff levels in the state bloated sectors. It was also agreed to implement a tax system for the "self-employed" sector to "respond" to the current economic changes.

Raul Castro's government will expand the self-employment to 178 activities in their plan to "upgrade" the socialist model and try to overcome the acute economic crisis affecting the country. The economic adjustment program will be ratified at the sixth edition of the Communist Party of Cuba congress scheduled for late April 2011.